The Heat is On for Polish Business in Iraq

Polish companies should hire armed Iraqis. It could be difficult to find the right people, but it would be a better move.

By Kamil Tchorek

Since the bombings last month of a holy Shi'ite shrine and the U.N. headquarters in Iraq, Polish business has had to re-assess its claim to the spoils of war. Donald Rumsfeld was concerned enough to make an appearance at the front line, where he told eager Polish military troops to wait a few days before taking over the South Central Zone, and bar several troublesome provinces.

Now that 'peace' has taken on a new dimension for the military and political leadership, Polish companies that expected to be integral to securing that peace through reconstruction have also had to adapt to the new reality.

The ever-ambitious Bartimpex Industrial Group (BIG) expects to sign the first sub-contractor deals in Iraq by the end of the year. At present, they are circulating an offer of a massive range of reconstruction services that go far beyond their oil and gas sector expertise. These include the building of schools; irrigation; and advanced IT solutions for the banking and finance sectors.

After the U.S-led Coalition forces issued a warning that they are not responsible for the safety of businesses that choose to invest in Iraqi reconstruction, Bartimpex told the Business Journal that it will recruit its own well-armed security force to protect its employees in Iraq. At its office in Baghdad, Bartimpex's three employees are carefully watched by minders.

"We cannot say with full certainty that local Iraqi security will always be most appropriate," says Konrad Werpachowski, a business consultant at Bartimpex. "Naturally, like most people involved in the Iraqi reconstruction process, we hope that with time the coalition forces, and later the local police authority, will have the situation under control and that we will be able to work ... without the need for extra security at all."

But General (Ret.) Sławomir Petelicki, strategic consultant to the Prime Minister and corporate security consultant for Andersen Business Consulting, says that creating what could effectively become a company's private army - even in the short term - would be foolish. "The Iraqi people trust Polish civilians, given that we had an industrial presence in Iraq for decades. But when foreigners such as Americans or Poles carry guns and have power over the local people - that is a problem. Polish companies should hire armed Iraqis. It could be difficult to find the right people, but it would be a better move."

Meanwhile Millennium Bank, in a consortium led by JP Morgan, is one of the first Polish companies to have won a tender, but has told the Business Journal that it has ruled out sending anyone to Iraq in person, seemingly leaving their American partners to take the brunt of the personal risk. The group will help set up and manage the Trade Bank of Iraq, with the goal of speeding up trade between Iraq and the rest of the world.

"We're effectively starting from scratch," says Wojciech Kaczorowski, a spokesman for the bank. "We will build the bank up from nothing, get it up and running so that it can conduct the normal business of a trade bank. But we will be doing that without sending any Millennium employees to Iraq. The security situation is of concern to us, and in this day and age, we can really do all our work from Poland."

The Conference for the Reconstruction of Iraq, where Millennium's board member, Marek Belka, chairs the International Coordination Committee, meets next month to discuss direct aid from major donors such as Japan and the EU.

Much has changed since the Bush administration said that Iraq should pay for its own reconstruction with oil sales. According to a statement by the U.N. Development Program (UNDP), "petroleum income will not be sufficient to cover Iraq's reconstruction needs," and "donor assistance will be vital" to kick-starting the business of reconstruction. The reconstruction of Iraq was once seen as an opportunity for Polish business - now Polish business is a vital part of securing the peace.